Correlation Between Linedata Services and Rubis SCA
Can any of the company-specific risk be diversified away by investing in both Linedata Services and Rubis SCA at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Linedata Services and Rubis SCA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Linedata Services SA and Rubis SCA, you can compare the effects of market volatilities on Linedata Services and Rubis SCA and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Linedata Services with a short position of Rubis SCA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Linedata Services and Rubis SCA.
Diversification Opportunities for Linedata Services and Rubis SCA
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Linedata and Rubis is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Linedata Services SA and Rubis SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rubis SCA and Linedata Services is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Linedata Services SA are associated (or correlated) with Rubis SCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rubis SCA has no effect on the direction of Linedata Services i.e., Linedata Services and Rubis SCA go up and down completely randomly.
Pair Corralation between Linedata Services and Rubis SCA
Assuming the 90 days trading horizon Linedata Services SA is expected to generate 1.02 times more return on investment than Rubis SCA. However, Linedata Services is 1.02 times more volatile than Rubis SCA. It trades about 0.08 of its potential returns per unit of risk. Rubis SCA is currently generating about 0.01 per unit of risk. If you would invest 4,800 in Linedata Services SA on August 31, 2024 and sell it today you would earn a total of 3,200 from holding Linedata Services SA or generate 66.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
Linedata Services SA vs. Rubis SCA
Performance |
| Timeline |
| Linedata Services |
| Rubis SCA |
Linedata Services and Rubis SCA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Linedata Services and Rubis SCA
The main advantage of trading using opposite Linedata Services and Rubis SCA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Linedata Services position performs unexpectedly, Rubis SCA can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Rubis SCA will offset losses from the drop in Rubis SCA's long position.| Linedata Services vs. Sword Group SE | Linedata Services vs. Lectra SA | Linedata Services vs. Neurones | Linedata Services vs. Aubay Socit Anonyme |
| Rubis SCA vs. Gaztransport Technigaz SAS | Rubis SCA vs. Nexity | Rubis SCA vs. SCOR SE | Rubis SCA vs. TotalEnergies SE |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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